Tesla Forecasts First Quarterly Profit on Model S Sales

Tesla Motors Inc. (TSLA), the electric-car maker headed by billionaire Elon Musk, climbed to a record after saying it turned its first quarterly profit on higher-than- forecasted sales of its Model S sedan, overcoming a controversy about the car’s performance.

Tesla rose 13 percent to $42.94 at 9:42 a.m. New York time after surging as much as 14 percent to $43.33. The stock gained 12 percent this year through March 28, topping the 10 percent rise in the Standard & Poor’s 500 Index. Tesla’s best closing price was $39.48 on Feb. 7.

Tesla reached “full profitability” as Model S sales were more than 250 units higher than the 4,500 that the electric-car maker projected in mid-February, according to a company statement yesterday that didn’t specify the profit figure. The average analyst estimate compiled by Bloomberg calls for a loss of 11 cents a share, excluding some items.

Tesla reached a profitability goal set by Musk, 41, as the Palo Alto, California-based company disputed a story about its Model S sedan by the New York Times that questioned the car’s driving range. Musk called the report “fake” and told Bloomberg Television it trimmed Tesla’s stock-market value by as much as $100 million. The public editor for the newspaper said its reporter didn’t use good judgment and “left himself open to valid criticism.”

“It’s an important milestone that everyone has been waiting for, but it’s certainly not time to break out the champagne,” Michelle Krebs, an analyst for Santa Monica, California-based auto researcher Edmunds.com, said by telephone. “They’ve got to sustain sales and profits every quarter. This is just a step along a path that’s going to be bumpy.”
‘Exciting’ News

Tesla said that its revised estimates are separate from the “really exciting” announcement that Musk alluded to in a Twitter post last week. That disclosure will be made tomorrow and is “arguably more important,” Musk said in a separate message on Twitter.
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